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Gold-backed crypto tokens surge past $3 billion amid record-breaking metal rally

TL;DR

• Gold milestone: Tokenized gold assets hit $3.04 billion as spot gold briefly topped $4,007 per ounce, with PAXG and XAUT leading the market.
• Market backdrop: Silver surged to $48.50, equities reached record highs, and Bitcoin briefly hit $126,200 amid the U.S. government shutdown.
• Debasement trade: Investors rotated into gold and Bitcoin as hedges against fiat erosion, though gold has outperformed Bitcoin in 2025.
  

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Tokenized gold assets have crossed a historic threshold, surpassing a $3 billion market cap as physical gold briefly traded above $4,000 per ounce for the first time. The milestone underscores the growing role of blockchain-based commodities in global markets, with investors flocking to safe havens amid political and economic uncertainty.

Gold-pegged tokens hit $3.04 billion

According to CoinGecko data, the market capitalization of gold-backed tokens such as PAX Gold, Tether Gold, and Kinesis Gold rose 2.5% in the past 24 hours to $3.04 billion. Trading volumes surged to $640 million, reflecting heightened demand. PAXG and XAUT remain the dominant issuers, each trading just below $4,000, closely mirroring spot gold’s trajectory. The surge coincided with gold’s record high of $4,007 per ounce before a modest pullback.

Precious metals rally alongside silver

The rally extended beyond gold, with silver climbing past $48.50, its highest level since 2011. Analysts point to renewed investor appetite for tangible assets as the U.S. government shutdown entered its sixth day. The political gridlock has amplified concerns over fiscal stability, reinforcing the appeal of metals as traditional hedges.

Equities and Bitcoin join the surge

Despite the safe-haven rush, equity markets remain resilient. The S&P 500 reached a record 6,753 points, signaling investor confidence in corporate earnings. Bitcoin also set a new all-time high, briefly touching $126,200 before easing to $123,200. The parallel rallies highlight a broad appetite for alternative and risk assets, even as macroeconomic uncertainty lingers.

Debasement trade fuels rotation

Market observers frame the moves as part of a “debasement trade,” where investors hedge against fiat erosion by rotating into scarce assets. “Digital assets, particularly Bitcoin, are emerging as clear beneficiaries,” said Javier Rodriguez-Alarcón, chief investment officer at XBTO. Still, the Bitcoin/gold ratio has slipped to 31.6 from over 40 in December 2024, suggesting gold’s relative outperformance this year despite Bitcoin’s 30% year-to-date rise.